Prohibit Inducements and Promotional Bonuses

A BILL FOR AN ACT

RELATING TO MOBILE SPORTS WAGERING; PROHIBITING INDUCEMENTS AND PROMOTIONAL
INCENTIVES DESIGNED TO INCREASE WAGERING; PROHIBITING VIP INCENTIVE PROGRAMS
AND REFERRAL REWARDS; PROVIDING FOR ENFORCEMENT, PENALTIES, AND RULEMAKING;
AND PROVIDING AN EFFECTIVE DATE.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF [STATE]:

SECTION 1. SHORT TITLE.
This Act may be cited as the "Sports Wagering Inducements Prohibition Act".

SECTION 2. DEFINITIONS.
In this Act:
  (1) "Commission" means the [STATE GAMING COMMISSION] or successor agency.
  (2) "Operator" means a person licensed or otherwise authorized under [STATE LAW] to
      conduct mobile sports wagering in this State.
  (3) "Inducement" means an offer, program, or item of value provided by or on behalf of an
      Operator that is intended to encourage a person to open an account, make a deposit,
      place a wager, increase wagering, or continue wagering, including:
        (A) deposit matches, sign-up bonuses, and reload bonuses;
        (B) "free bets", "bonus bets", free spins, or similar wagering credits;
        (C) enhanced odds, boosted odds, or "special" pricing offers;
        (D) cashback, loss-back, insurance, or "risk-free" / "no-sweat" wagers or parlays;
        (E) loyalty points, tiered rewards, or other benefits contingent on wagering volume;
        (F) referral rewards, affiliate rewards, or "invite-a-friend" incentives;
        (G) VIP programs, including assignment of a host or manager who provides discretionary
            benefits contingent on wagering; and
        (H) any materially similar incentive as determined by the Commission by rule.
  (4) "Marketing" means advertising, promotion, direct messaging, push notifications, email,
      SMS, in-app messaging, or other communications intended to solicit wagering.

SECTION 3. PROHIBITION ON INDUCEMENTS.
  (a) General prohibition. An Operator shall not offer, advertise, provide, or honor an Inducement
      to any person located in this State.

  (b) VIP and targeted programs prohibited. An Operator shall not operate a VIP, host, or
      "managed player" program that provides individualized benefits contingent on wagering.

  (c) Referral rewards prohibited. An Operator shall not provide referral rewards to a patron or
      third party for recruiting new patrons.

SECTION 4. LIMITED EXCEPTIONS.
This Act does not prohibit:
  (1) correction of errors (including refunds due to voided wagers);
  (2) non-promotional, non-contingent customer service accommodations required by law or
      necessary to resolve disputes; or
  (3) responsible-gambling tools and communications that do not provide an item of value and
      are not intended to solicit wagering.

SECTION 5. RECORDKEEPING; AUDITS.
  (a) Records. An Operator shall maintain records sufficient to demonstrate compliance with this
      Act, including marketing materials and offer terms, for the period required by Commission rule.

  (b) Audits. The Commission may audit Operators and may require submission of marketing and
      product materials for review.

SECTION 6. ENFORCEMENT; PENALTIES; RULEMAKING.
  (a) A violation of this Act or a rule adopted under this Act constitutes grounds for license
      discipline.

  (b) The Commission may impose a civil penalty of up to [$25,000] per violation. Each day an
      Inducement is offered to persons located in this State constitutes a separate violation.

  (c) The Commission shall adopt rules to implement this Act, including rules to:
        (1) clarify categories of prohibited Inducements;
        (2) define marketing record retention requirements; and
        (3) establish complaint and enforcement procedures.

SECTION 7. SEVERABILITY.
If any provision of this Act or its application is held invalid, the invalidity does not affect
other provisions or applications of this Act that can be given effect without the invalid
provision or application.

SECTION 8. EFFECTIVE DATE.
This Act takes effect on [DATE].